BCG Blog

New recommendations from the federal government call for wider use of dashboards for retirement plan participants. But plan sponsors know that not all dashboards are created equal. Following tips on user experience from other industries can help sponsors craft dashboards that help participants be better prepared for their investment planning.

The merits of alternative investments for many investors as appropriate vehicles for diversification can be reduced when decisions are motivated by emotional investing. While advisors are familiar with this dangerous dynamic duo, new approaches suggest that the risky mix of emotional investing and alternative investments may be harmonized by something as simple as education.

The gap between new, more lenient regulations on who can qualify as an employer under ERISA and providing those plans might be filled by financial advisors if advisors can understand how to market their services to those groups. To understand how to cross this gap, advisors may want to understand the history of the rule change, how associations make decisions, and how to market to them.

Recent Supreme Court cases restricting the powers of regulatory agencies like the DOL and SEC cases may have injected an enormous punch of uncertainty into most financial advisor’s plans. It could be the ultimate unknown unknown. But fear not, advisors may have a friend in flexibility.

A handful of federal cases ruling in favor of plan sponsors on recordkeeping fees may provide important details on effective benchmarking. Sponsors may note that merely comparing fees between plans was not deemed a sufficient basis of comparison. Instead, comparator plans (for benchmarking) should include all services requested.

Plan sponsors play a critical role in helping employees secure their financial future. While retirement plans are often at the forefront of this effort, it's also important to consider other financial tools that can support employees' broader financial well-being. One such tool is the 529 plan, designed specifically for education savings.

REAL ID is making it really hard to open new accounts. The change in identity verification requirements may only impact not yet enrolled plan participants. Yet, for participants who may be opening multiple accounts (such as those who’ve moved or younger participants) the increase in requirements could deter their interest in enrolling in benefits.

In the race to keep up with AI advancements, it seems like financial advisors just got a power boost. In early June of 2024, the FINRA Investor Education Foundation reported new research suggesting consumer trust favored financial professionals more than AI in terms of financial information.

Over the years, we’ve weighed the pros and cons of various social media platforms on financial literacy. Sometimes, preference for social media runs along generational lines. Lately, two trends may have combined to create an important issue for financial advisors: a reduction in attention span and the rise in so called “Finfluencer” may mean clients are relying on TikTok for financial education.

Recent research released in June of 2024 by MFS Investment Management may reflect that the scope of risk is shifting. These concerns include administrative and regulatory changes as well as continuing concerns about retirement readiness of plan participants. These concerns about managing volatility and adjusting for potential litigation risks may have financial advisors considering their current offerings of investment monitoring.

Recent enforcement actions by the Department of Labor indicate an uptick in cases against profit sharing plans. Class action settlements show that plaintiffs continue to keep a watchful eye on retirement plan fee choices. A new report indicates that activist shareholder whistleblowers may be using more than 10% of the SEC’s enforcement budget.

In 2023, the job market underwent changes as it sought to recover from pandemic-related disruptions and grappled with the aftermath of the Great Resignation. The start of 2024 has brought significant changes in how temporary workers are classified and their eligibility for benefits, driven by the SECURE Act and the DOL’s recent ruling on independent contractors.

A new report by the National Institute on Retirement Security (NIRS) highlights that rise in interest in private pensions. Their report makes recommendations for private, non-union based, pension plans. Given an interest by public pensions such as CalPERS in how they manage assets to hedge risks, the NIRS recommendations indicate a change towards positively viewing pensions.

A new report shows that a large percentage of employees are using AI at work, without their employer’s knowledge or approval. Unauthorized AI can create serious cybersecurity risks for those handling private financial information. Such use may also run afoul of the EBSA’s recommendations for retirement plan service providers.

A recent article highlighted on NASDAQ’s news page noted that demographic changes among retirees may create opportunities for more diversity among advisors. Yet, that report seems to not align with other, more recent studies. That may beg the question, what is the state of gender diversity in asset management and financial advising?

A recent opinion from the Supreme Court on a regulatory agency’s funding could resolve some questions over the future of regulation of the retirement planning industry. Yet, there may also be changes on the horizon through related legislation.

A new report from the Center for Retirement Research may be important for advisors who plan to pitch their fiduciary services to small firms. Released in March of 2024, the 2023 Small Business Retirement Survey assesses the beliefs of small business owners regarding retirement benefits and how those beliefs move their decisions to offer, or not, such benefits.

In recent years ESG investing has emerged as a popular choice for investors looking to align their portfolios with their values. One of the key questions advisors may hear from their clients is whether ESG funds perform as well as traditional investments and if they can be a valuable addition to a diversified investment portfolio. Here is a review of where the industry stands on this area.

The average professional worker is swamped by more than 120 emails per day. In this deluge of emails, a problem bobs along like a tiny rowboat: your marketing leads. If you feel like you need to level up your follow ups, here are a few new strategies we’ve seen from a variety of industries.

When it comes to hardship withdrawals, participants may focus more on what they hear and not what is in your plan. Plan Sponsors may want to pause and consider what participants hear versus what the new laws now permit.

Many Plan Sponsors balance their administrative concerns by approaching their various fiduciary and administrative responsibilities via checklists and project plans. Yet even these planning tools may fall short. Most of those approaches fail to address both administrative and analytical issues. A quarter by quarter approach may help create the right balance.

Over the last few years, employers took note of the role benefits played in recruiting employees. Some employers considered matching payments to student loans. But nearly half of employers have chosen not to adopt matching programs. And now several trends may show that hesitancy is warranted.

Recently, the IRS issued guidance on implementing section 348 (cash balance accounts). This guidance may hint at potential regulatory flexibility towards plan testing. Similarly, section 304 (automatic cash out of small accounts) could lead to flexibility in plan audits for small plans.

In the realm of employee benefits, change is inevitable. Sometimes, however, change comes in the form of cutbacks, which can be unsettling for employees. As a plan sponsor, effectively communicating these changes to your workforce is paramount. In today's landscape, where employees expect transparency and authenticity, navigating benefit cutbacks requires finesse and a departure from traditional corporate speak.

As corporate governance business processes become part of plan litigation, and because benefits may be an area ripe for budget trimming, management of employee benefits policies is attracting more attention. Caution is due in this area as AI systems create their own risks.